Two-sided certification: The market for rating agencies

Arbeitspapier

Certifiers contribute to the sound functioning of markets by reducing asymmetric information. They, however, have been heavily criticized during the 2008-09 financial crisis. This paper investigates on which side of the market a monopolistic profit-maximizing certifier offers his service. If the seller demands a rating, the certifier announces the product quality publicly, whereas if the buyer requests a rating it remains his private information. The model shows that the certifier offers his service to sellers and buyers to maximize his own profit with a higher share from the sellers. Overall, certifiers increase welfare in specific markets. Revenue shifts due to the financial crisis are also explained.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: SFB 649 Discussion Paper ; No. 2010,007

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Information and Market Efficiency; Event Studies; Insider Trading ; Investment Banking; Venture Capital; Brokerage; Ratings and Ratings Agencies ; Information and Product Quality; Standardization and Compatibility ; Asymmetric and Private Information; Mechanism Design
• Thema: Certification ; Rating Agencies ; Asymmetric Information ; Financial Markets ; Ratingagentur ; Finanzdienstleistung ; Kreditwürdigkeit ; Asymmetrische Information ; Monopol ; Lieferanten-Kunden-Beziehung ; Wohlfahrtseffekt

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Fasten, Erik R. ; Hofmann, Dirk
• Ereignis: Veröffentlichung
• (wer): Humboldt University of Berlin, Collaborative Research Center 649 - Economic Risk
• (wo): Berlin
• (wann): 2010

Weitere Informationen

• Handle: http://hdl.handle.net/10419/39306
• Letzte Aktualisierung: 10.03.2025, 11:42 MEZ